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In 1877, the Venezuelans proposed to the British Government that both countries should take the existing border dispute to arbitration for a final settlement. During the same time, the Venezuelans also began to woo the support of the United States of America by appealing to that nation to support their claims. However, the United States, during that period, refused to become involved. Venezuela, itself, never diverted from its view that arbitration was the only means of settling the border dispute.

Despite its refusal to be involved in the issue in 1877, the policy of the United States by 1886 began to take a decisive turn when it offered advice to the British Government to solve the issue. By then, the United States had achieved great economic strength and international political stature, and many leading American politicians viewed their country as a major competitor to Great Britain in the field of international politics.

In 1895, Grover Cleveland, who was then serving a second term as President, realised that his administration was losing popularity especially among western and southern farmers and workers everywhere in the country. He and his Secretary of State, Richard Olney, in an attempt to divert attention from the domestic problems that faced the country, decided to adopt a vigorous foreign policy. They, therefore, agreed, inter alia, to support the Venezuelan side in the boundary dispute with Great Britain.

Through the efforts of the Cleveland administration, a resolution was introduced in the United States Congress urging Venezuela and Great Britain to settle the dispute by arbitration. The resolution passed through both Houses of Congress unanimously and President Cleveland signed it on the 20 February 1895.

This act by the United States Congress gave the Venezuelans what they desired since 1877 full United States intervention in favour of Venezuela. With Cleveland's approval, Richard Olney prepared a statement of the case on the 20 July 1895, which was then presented to the British Government. In this statement, Olney protested against the enlargement of British Guiana at the expense and defiance of Venezuela, thus assuming, without any specific proof, that the British had already violated the Monroe Doctrine of 1823 which had declared that "the American continents by the free and independent condition which they have assumed and maintain, are henceforth not to be considered as subjects for future colonization by any European powers". Olney stated, with no justification, that the Monroe Doctrine had the full status of international law. He also demanded that the issue be put to arbitration.

On the 7 December, the British reply to Olney's letter was finally received by the United States Government. It was issued by the Prime Minister, Lord Salisbury, who countered Olney's contentions, and denied that the Monroe Doctrine was applicable to the border dispute. Referring to the demand for arbitration, he declared that the only parties competent to decide whether or not it was "a suitable method of procedure ... are the two parties whose rival contentions are in issue. The claim of a third nation, which is unaffected by the controversy, to impose this particular procedure on either of the two others, cannot be reasonably justified and has no foundation on the law of nations".

The British Prime Minister declared that his Government was "not prepared to admit that the interests of the United States are necessarily concerned in every frontier dispute which may arise between any two of the states who possess dominions in the Western Hemisphere". He also insisted that his Government could not consent to arbitrate the British claim to any of the territory east of the Schomburgk Line. The British Government, he concluded, "cannot consent to entertain, nor to submit to the arbitration of any power or of foreign jurists, however eminent, claims based on the extravagant pretensions of Spanish officials in the last century, and involving the transfer of large numbers of British subjects, who for many years enjoyed the settled rule of a British Colony, to a nation of a different race and language..."

On the 17 December 1895, the President delivered a special address to the United States Congress in which he dealt with the border dispute. He used a great part of his address to defend the Munroe Doctrine. He also announced that he would appoint a commission to determine "what is the true divisional line between the Republic of Venezuela and British Guiana. The inquiry to that end should of course be conducted carefully and judicially, and due weight should be given to all available evidence, records, and facts in support of the claims of both parties".

He declared that following the report of the commission, "it will, in my opinion, be the duty of the United States to resist by every means in its power, as a wilful aggression upon its rights and interests, the appropriation by Great Britain of any lands or the exercise of governmental jurisdiction over any territory which after investigation we have determined of right belongs to Venezuela. In making these recommendations I am fully alive to the responsibility incurred and keenly realize all the consequences that may follow."